1. AMERICAN EXPRESS BANK, FSB
Business
American Express Bank, FSB (“FSB”) was incorporated under United States law as a federal savings bank
in 2000 and received Federal Deposit Insurance Corporation (“FDIC”) insurance in the same year. Its
principal office is located at 4315 South 2700 West, Salt Lake City, Utah 84184. FSB is a wholly-owned
subsidiary of American Express Travel Related Services Company, Inc. (“TRS”). FSB commenced its
current operations as American Express Bank, FSB in April 2004.
The information about FSB presented below is qualified in its entirety by reference to and should be read in
conjunction with FSB’s Quarterly Thrift Financial Reports covering the years ended December 31, 2007,
2006, and 2005. Note, however, certain amounts in 2006 and 2005 have been reclassified to conform to the
2007 presentation.
FSB issues OPEN from American Express (“OPEN”) and American Express co-branded revolving credit
cards in the United States. FSB is also the issuer of certain OPEN charge cards. In addition, FSB has
outstanding lines of credit in association with certain OPEN and consumer charge cards and offers
unsecured loans to cardmembers in connection with its Extended Payment Option programs. The Extended
Payment Option offers qualified United States cardmembers the option of extending payment for certain
charges on the charge card.
In addition, FSB offers online banking services that provide consumers with competitive rates on deposits
and lending products and the convenience of banking by the Internet, telephone, ATM, or mail.
In addition to earning cardmember lending finance revenues, FSB also receives revenue from cardmember
fees and discount revenue from service establishments. The cardmember account is offered in different
versions with a variety of features and terms, including co-branded cards, cards with differing rates, fees
and grace periods, and cards with additional features such as rebates.

2. AMERICAN EXPRESS BANK, FSB
Results of Operations
Years Ended December 31, 2007, 2006, and 2005
FSB’s results of operations are based on financial information reported in its Thrift Financial Reports filed
with the Office of Thrift Supervision (OTS).
FSB reported net income of $876 million, $795 million, and $493 million for the years ended December
31, 2007, 2006, and 2005, respectively. The year-over-year increase in net income was primarily due to
growth in FSB’s average loan balance and discount revenue, offset by increased funding cost and rewards
expense. In 2007, 2006, and 2005, return on average assets was 4.02 percent, 4.89 percent, and 3.77
percent, respectively.
Interest income increased to $2.9 billion in 2007 compared to $1.9 billion in 2006 and $1.6 billion in 2005
as a result of increased average loan balances to $18.9 billion in 2007 from $14.5 billion in 2006 and $11.6
billion in 2005 and increased average yields on the portfolio.
Interest expense increased to $867 million in 2007 compared to $635 million in 2006 and $352 million in
2005 as a result of increased average deposit liabilities and bank notes to fund loan growth and enhance
FSB’s liquidity position coupled with higher effective cost of funds.
Provision for loan losses increased to $1.1 billion in 2007 compared to $465 million in 2006 and $441
million in 2005 reflecting higher average loan balances each year and negative credit trends among U.S.
consumers in the latter part of 2007. At December 31, 2007, 2006, and 2005, FSB’s reserves as a
percentage of delinquencies were 112 percent, 76 percent, and 104 percent, respectively. Loans are written
off when management deems amounts to be uncollectible and is generally determined by the number of
days past due. In general, loans in bankruptcy or owed by deceased individuals are written off upon
notification, while other accounts are written off when 180 days past due. The net charge-off rates as a
percentage of average loans for the years ended December 31, 2007, 2006, and 2005 were 4.18 percent,
2.92 percent, and 3.98 percent, respectively.
Non-interest income was $3.8 billion, $3.3 billion, and $2.3 billion and non-interest expense was $3.4
billion, $2.9 billion, and $2.4 billion, in 2007, 2006, and 2005, respectively. Non-interest income increased
primarily due to higher discount revenue. Non-interest expense increased due to increased marketing and
cardmember rewards.
Income tax provision and effective tax rate for the years ended December 31, 2007, 2006, and 2005 were
$507 million or 36.7 percent, $471 million or 37.2 percent, and $275 million or 35.8 percent, respectively.
At December 31, 2007, 2006, and 2005, FSB exceeded the OTS “well-capitalized” levels for tier 1 core,
total risk-based and tier 1 risk-based capital. The tier 1 core capital ratios in 2007, 2006, and 2005 were
11.10 percent, 10.39 percent, and 10.72 percent, respectively. The total risk-based capital ratios in 2007,
2006, and 2005 were 12.80 percent, 11.32 percent, and 11.72 percent, respectively. The tier 1 risk-based
capital ratios in 2007, 2006, and 2005 were 11.53 percent, 10.06 percent, and 10.46 percent, respectively.
At December 31, 2007, the OTS “well-capitalized” levels for tier 1 core, total risk-based and tier 1 risk-
based capital were 5.00 percent, 10.00 percent, and 6.00 percent, respectively.
Liquidity and Capital Resources
FSB funds its lending activities principally through the sale of certificates of deposits and through
borrowings from banks and affiliates. At December 31, 2007, 2006, and 2005, FSB had $8.0 billion, $7.5

3. billion, and $7.9 billion of certificates of deposit and other deposits outstanding, $11.3 billion, $7.0 billion,
and $4.1 billion in bank notes outstanding and $1.1 billion, $641 million, and $845 million in federal funds
purchased, respectively.
FSB periodically securitizes Cardmember loans through the American Express Credit Account Master
Trust (the “Lending Trust”). In a securitization structure like the Lending Trust (a revolving master trust),
credit card accounts are selected and the rights to the current Cardmember loans, as well as future cash
flows related to the corresponding accounts, are transferred to the trust for the life of the accounts. FSB is
required to maintain an undivided interest in the transferred Cardmember loans, which is referred to as the
“seller’s interest,” and is generally equal to the balance of all Cardmember loans transferred to the Lending
Trust less the investors’ portion of those assets. The “investors’ interest” is created when the Lending Trust
issues a security to a third party. The seller’s interest received by FSB in consideration for the transfer of
Cardmember loans is reflected in FSB’s balance sheet as a component of Cardmember loans.
When the Lending Trust issues a security to a third party, a new investor interest is created. FSB removes
the corresponding Cardmember loans from its balance sheet, recognizes a gain on sale and release of credit
reserves and records an interest-only, or IO strip. From time to time, FSB may record other retained
interests as well. The total investors’ interest outstanding will change through new issuances and maturities.
The seller’s interest will change as a result of new trust issuances or maturities as well as new account
additions, new charges on securitized accounts and collections. As seller’s interest changes each period, the
related allowance for loss will change as well. When a security matures, the Lending Trust uses a portion of
the collections to repay the security, and as a result the investors’ interest decreases. In the monthly period
which contains a maturity, new charges on securitized accounts have historically been greater than the
portion of the collections required to repay the maturing security, and therefore, seller’s interest has
increased in an amount greater than or equal to the decrease in investors’ interest.
Under the terms of the Lending Trust, the occurrence of certain events could result in the trust being
required to pay down the investor certificates and notes before their expected payment dates over an early
amortization period. An example of such an event is the failure of the securitized assets to generate
specified yields over a defined period of time. No such events occurred during 2007, 2006, or 2005, and
FSB does not expect an early amortization trigger event to occur prospectively. However, if a paydown of
the Lending Trust were to occur, the securitized loans would revert to FSB’s balance sheet and FSB would
be required to re-establish reserves and to derecognize the retained interests related to those securitizations.
These events could have a negative impact on FSB’s results of operations.
At December 31, 2007, 2006, and 2005, the total Cardmember loans held by the Lending Trust that had
been transferred by FSB were $11.5 billion, $11.0 billion, and $9.4 billion, respectively, of which $7.4
billion, $6.6 billion, and $7.1 billion, respectively, had been sold and $4.2 billion, $4.4 billion, and $2.3
billion, respectively, had been classified as seller’s interest. FSB also retains a subordinated interest in the
securitized Cardmember loans, an IO strip. At December 31, 2007, 2006, and 2005, the fair value of the IO
strip was $45 million, $51 million, and $45 million, respectively. The IO strip is recorded in other assets on
FSB’s balance sheet.
FSB sells its charge Card receivables on its non-interest bearing charge cards on a monthly basis to TRS
and American Express Credit Corporation, a wholly-owned subsidiary of TRS.

4. SELECTED FINANCIAL INFORMATION OF AMERICAN EXPRESS BANK, FSB
The following unaudited financial information of FSB for each of the years ended December 31, 2007,
2006 and 2005 was derived from the TFRs and should be read in conjunction therewith and with the
detailed information contained elsewhere herein and incorporated by reference. Certain amounts in 2006
and 2005 have been reclassified to conform to the 2007 presentation.
For the Year-Ended December 31,
(in millions)
2007 2006 2005
Operating Data:
Interest income $ 2,906 $ 1,943 $ 1,596
Interest expense 867 635 352
Net interest income 2,039 1,308 1,244
Provision for loan losses 1,126 465 441
Income after provision for loan losses 913 843 803
Non-interest income 3,844 3,292 2,344
Non-interest expense 3,374 2,869 2,379
Net non-interest (expense) income 470 423 (35)
Pretax income 1,383 1,266 768
Income tax provision 507 471 275
Net income $ 876 $ 795 $ 493
As of December 31,
(in millions)
2007 2006 2005
Balance Sheet Data:
Assets:
Cash and cash equivalents $ 2,085 $ 521 $ 551
Investments 1,105 1,053 1,045
Loans 21,871 17,941 13,338
Reserves (735) (385) (347)
Loans, net 21,136 17,556 12,991
Other assets 714 687 956
Total assets $ 25,040 $ 19,817 $ 15,543
Liabilities and Shareholder’s Equity:
Deposits liabilities $ 8,010 $ 7,493 $ 7,916
Federal funds purchased 1,138 641 845
Bank notes 11,290 7,000 4,100
Total debt 20,438 15,134 12,861
Other liabilities 1,723 2,516 911
Total liabilities 22,161 17,650 13,772
Total shareholder’s equity 2,879 2,167 1,771
Total liabilities and shareholder’s equity $ 25,040 $ 19,817 $ 15,543

5. SELECTED FINANCIAL INFORMATION OF AMERICAN EXPRESS BANK, FSB
(in millions) As of December 31,
2007 2006 2005
Key Statistics:
Average assets $21,817 $16,255 $13,083
Average shareholder’s equity 2,622 2,014 1,639
Average loans 18,902 14,457 11,550
Total Risk-weighted assets (net) 22,289 18,260 13,909
Tier 1 risk-based capital 2,768 2,046 1,654
Total risk based capital 2,853 2,067 1,630
Past-due & non-accrual loans 657 508 334
Net charge-offs 791 422 460
As of December 31,
2007 2006 2005
Selected Ratios:
Return on average assets(1) 4.02% 4.89% 3.77%
Return on average shareholder’s equity(2) 33.41% 39.47% 30.07%
Tier 1 core capital ratio 11.10% 10.39% 10.72%
Total risk-based capital ratio 12.80% 11.32% 11.72%
Tier 1 risk-based capital ratio 11.53% 10.06% 10.46%
Net charge-offs / average loans(3) 4.18% 2.92% 3.98%
Reserves / past due & non-accrual loans(4) 112% 76% 104%
Reserves / loans 3.36% 2.15% 2.60%
Past due & non-accrual loans / loans 3.01% 2.83% 2.50%
(1) Return on average assets is calculated by dividing net income by average assets. The OTS defines average assets as each month
during the year’s average month-to-month divided by total months in the year.
(2) Return on average shareholder’s equity is calculated by dividing net income by average shareholder’s equity. The OTS defines
average shareholder’s equity as each month during the year’s average month-to-month divided by total months in the year.
(3) Net charge-offs / average loans is calculated by dividing gross charge-offs less recoveries by full year average loans.
(4) Past due and non-accrual loans is based on the TFR definition, i.e. all balances that are 30 days past due and still accruing plus
all non-accrual loans.

6. CAPITALIZATION OF AMERICAN EXPRESS BANK, FSB
The following table sets forth the consolidated capitalization of FSB at December 31, 2007, 2006, and 2005.
The table should be read in conjunction with FSB’s Quarterly Thrift Supervision Reports incorporated by
reference herein.
As of December 31,
2007 2006 2005
(in millions)
Deposits liabilities:
Total $ 8,010 $ 7,493 $ 7,916
Short-, medium- and long-term indebtedness:
Federal funds purchased $ 1,138 $ 641 $ 845
Bank notes 11,290 7,000 4,100
Total $ 12,428 $ 7,641 $ 4,945
Shareholder’s equity:
Common shares $ - $ - $ -
Capital surplus 1,290 1,290 1,290
Undivided profits and capital reserves 1,589 877 481
Total shareholder’s equity $ 2,879 $ 2,167 $ 1,771
Total capitalization $ 23,317 $ 17,301 $ 14,632